The negative market sentiment has spread rapidly and as a result, Dogecoin price continues to oscillate around $0.2. This puts the meme coin in a dangerous position that could see its decline deepen from now on. One thing that could make a difference would be an increase in momentum, but volume has already decreased significantly so this route is still an issue. Another major issue is the rising resistance at $0.21, which could halt any recovery.
What happens if Dogecoin price exceeds $0.218?
The cryptanalyst Diana Sánchez has highlighted Dogecoin’s bullish potential, suggesting the price has been showing strength. This comes with the recent market fluctuations before the Federal Reserve’s decision after the FOMC meeting. However, at this point there is an important level where there is still a lot of resistance.
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The first thing the analyst points out is that despite the current struggle, the Dogecoin price has already increased by more than 43%. This makes it one of the best artists among the top cryptocurrencies by market cap, and momentum could turn bullish once again.
However, the main problem now lies at the $0.218 level, where the bears are mounting their defense. For now, it continues to hold support at $0.2, and this has become the main source of interest for bulls looking to continue the rally.
The main point at the moment, explains the crypto analyst, is to break the resistance of $0.218. If this resistance is broken, Dogecoin price is expected to continue rising. With this, the analyst says that Dogecoin’s price increase to the $0.5 target is no longer a dream.
Low volume could be a hindrance to recovery
Despite the optimism shown on the Dogecoin price chart, the fact that daily trading of the meme coin remains low. keep putting a brake in things. By early October, daily trading volume had surpassed $20 billion before seeing a pullback.
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However, since then, daily trading volume has continued to decline, reaching an average of $5 billion at the time of writing, as shown on the Coinglass website. Therefore, unless there is a notable increase in trading volume, any breakout could lack momentum, meaning the price could quickly correct and regain its gains.
Featured image of Dall.E, chart from TradingView.com
